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MONEY With Melissa Francis

News/Business. Melissa Francis with a breakdown of the day's top stories and their impact on the American Taxpayer. New.

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01:00:00

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mpeg2video

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TOPIC FREQUENCY

Us 12, U.s. 8, Adam 7, United States 7, Kim 4, Mitch Mcconnell 4, Boehner 4, Scott 3, Jason Altmire 2, Biotene 2, Unitedhealthcare 2, Robinson 2, T. Rowe 2, Peter Barnes 2, John Barrasso 2, Iran 2, Scott Martin 2, Joe Biden 1, Latourette 1, Economy 1,
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  FOX Business    MONEY With Melissa Francis    News/Business. Melissa Francis with a breakdown of the day's  
   top stories and their impact on the American Taxpayer. New.  

    December 31, 2012
    5:00 - 6:00pm EST  

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david:. >> we're very, very close to an agreement. we need to protect american families and job creators from this looming tax hike. everyone afrees that that action is necessary and i can report that we have reached an agreement on all of the tax, the tax issues. we are very, very close. adam: close but you no cigar. the u.s. falls off the fiscal cliff at midnight despite something in the work. you heard what senate minority leader mitch mcconnell said earlier today. we have members from both the house and senate on what happens next. i'm adam shapiro, in for melissa francis. on "money" the capital-gains tax in the cross-hairs.
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the capital-gains tax will spike in the new year. how can investors protect themselves from the coming blow? respect your elders or else. a parents dream, a child's burden. adult children forced to financially support mom and dad and pay regular visits in one major country. we'll tell you where and why they're doing it. even when they say it's not, it is always about money adam: had enough of the fiscal cliff yet? before we go there, let's take a look at the day's market headlines a whipsaw for the session for the markets on their last trading day of the year. signs congress was taking major steps toward a fiscal cliff agreement. the dow closed near session highs, climbing 166 points the dow gained 7.3% for the year. now that sent the fear index or the vix into a tailspin.
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it nosedived 20% as fiscal cliff optimism swept over investors. it had been up almost 30% since july. today's dive is the vix's steepest fall since august 2011. and the fiscal cliff tug-of-war september gold prices p by about 20 bucks an ounce, settling at $1675 for the year. gold prices rose 7% but, that is their smallest yearly gain in four years. we can't avoid it, the top story. fiscal cliff armageddon. no escaping it. the no escaping it. the country waits for action which could come tonight with a vote in the senate, but nothing, nothing has been scheduled and the house won't be able to act until later this week. joining me now is democratic congressman jason altmire from pennsylvania. sir, we appreciate you being here. i appreciate you will be leaving congress. you will not be able to vote on whatever is finally
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presented but i'm curious, does the senate deal have the potential if it gets through the senate to pass the house? >> i think it is going to pass the house. as i understand the parameters of the deal, the house i think would get a majority vote, probably substantial majority. i think it will pass the senate. it might still happen not tonight but tomorrow. that would still be the current session of congress. we're not getting a bill to the president tonight just because of the logistics of drafting the bill, presenting it to the senate and bringing it to the house but i think we'll get it done tomorrow. so we will have avoided a catastrophic event for the economy but we still could have done better with the timing. adam: let's point out some of the details what's in the work in senate. we understand the deal, at least for taxes which mitch mcconnell, said, taken care of. taxes going up for anybody making 400,000, single person, $450,000 for a married couple. we understand that. as soon as it gets to the
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house, tomorrow? and when could the house vote on this. >> assuming speaker boehner brings the senate bill to the house floor for a vote. we don't have confirmmation he will do that, it could be as early as tomorrow morning assuming the senate acts, at which point we pass it to get it on the president's desk by the end of the day tomorrow. adam: it doesn't include any of the spending cuts that republicans have been adamant about getting. spending out of control. democrats and republicans agree upon that. how does speaker boehner rally members of his caucus who did not rally behind him about a week ago if there are no spending cuts? >> a couple of things. remember the sequestration still takes effect because we didn't act to change that. those are spending cuts. those are hundreds of billions of dollars of spending cuts. republicans don't like the way those cuts come down but they're real cuts. assuming we don't deal with that, you have the debt ceiling coming up. speaker boehner really didn't have any leverage with regard to what we're ing right now with the fiscal cliff but he has a
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lot of leverage with the debt ceiling. i hope he doesn't choose to use it by leveraging the futh, faith and credit of the united states to gain political points but if he chooses to use the debt ceiling as a way to do entitlement reform and long-term spending cuts, that's a way, probably in february he can get that done. that might bring people along. >> congressman, i want to point out to the people watching you were one of the members of congress during your tenure, you returned one million dollars unspent office funds back to the treasury. i don't know many members of congress to do that i forget you being a florida state grad. most of my friends are gators. >> sorry to hear about that. adam: all seriousness, congress right now, as you depart has a reputation that is at the bottom. i could use all kinds of negative adjectives to describe it. i don't need to tell you. how does congress get the respect it needs to govern back after this craziness which is still not played out, and who gets the blame
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for this? >> well, understand, that congress is made up of people who have won election in 435 districts. the 50 states with two senators. the american people can decide who they are sending to congress. so, these are duly elected people who represent districts and just because somebody in one district vote as certain way that somebody in another district doesn't like --. adam: you lose nothing. you're done. you lose nothing by speaking truth to the other 434 members. what would you say to them? >> well, i think that we have shown, historically, not just this year but every the decades that congress is not good except if there's a deadline the reason the fiscal cliff exists we pushed until the end of the year this harmonic convergence of tax increases and spending cuts that are unpalatable to force action. otherwise congress would never get it done. that is speaker boehner's leverage with the debt ceiling. so i think we could do a lot better with the type of people that we're electing
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to congress, moving away from the extremes and bringing more centrists who can work together. i could give you a long speech about that when you combine those two things, you don't get a great work product. adam: congressman jason altmire, you mentioned harmonic convergence that happens in south florida. you're going to blue cross-blue shield up in tallahassee. you won't get that there. all the best to you, sir. congratulations on your service in congress. wish awe happy new year. >> happy new year, thank you. adam: so we'll get the republican take from senator john barrasso just a lit later in the program. he is kook discussing right now with other members of the republican caucus in the senate. they're talking about all of this. obviously the final physical cliff deal affects everybody, every aspect of our money, the markets, the economy. some say no matter what the damage has been done. we have money panel with wisdom to help us get through all of this. scott martin, is also a
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spewed baker fan. kill holme, and stephen hayes, writer at weekly standard and fox news contributor. i want to start with kim. from a small business perspective, this deal to only tax people who make 400,000, the, does that spare small business that might look at their funds as a pass-through when it comes tax time or will this still be horrendous for them. >> it is horrendous and horrendous for myself and my action and those of us who have flow-down through s-corps. i certainly think they made some progress but, you know, obviously as somebody said earlier in the day, taxation does not lead to prosperity. certainly would like to use that money for something else. buying equipment. bringing on new employees and expanding our business. adam: steve hayes, let me ask you and pick up where kim was just speaking the
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national federation of independent businesses estimate 75% of small business, which we know is the powerhouse, the dynamo of job creation in this country, 75% count their taxes the way that it is called the pass-through or the flow-through. essentially they're the people who get caught by the income tax increase. so this deal that the republicans have agreed to, have they sold out small business or is this the best they can get to protect small business? >> well, look, the deal is going to be a bad deal no matter what happens. it was always going to be a bad deal no matter what happens because the circumstances that led to the creation of the super-committee and failure and sequester. all this was going to be bad from the beginning but i think the idea of raising taxes right now, i'm not in favor of raising taxes anytime, raising taxes now when the economy is failing to sort of get off the ground is a terrible idea. of course it is going to hurt small businesses whether you set the threshold of 250,000 or 450,000. it is going to hurt small businesses.
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you don't have to take my word for it. you don't have to talk to republican senators to tell you that. the president of the united states has made that argument in the past and he was right when he made the argument in the past and is wrong when he is pushing for it now. adam: let's go over to scott martin. how will this affect at all, the men and women you do business with? how does the increase in income tax affect you and investors? >> well it is a blow to confidence, adam. i think to kind of carry on the point the other two guests made, listen, taxation is an issue, yes, and i think higher taxes stink for businesses and stinks for spending and investing to your point of the question but it is also a spending issue too, adam. that is what is hitting people. if taxes go up i think that would be somewhat okay as long as they go up marginally but we're not addressing any spending issues. no sequestration. no attack on entitlement spending. the president, started even with bush too, wants to raise debt sealing to unknown number. there are a lot of things
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that hit confidence than they hit wallets, adam. back to kim's point originally, because of this and me as business owner i don't want to spend money in my business. i don't have the money to hire people. that is the confidence going forward that nobody has. adam: kim, i will pick up on something scott said. no sequestration. right now there will be sequestration. the deal in the works would delay that for 60 to 90 days, so the new congress could restore spending cuts potentially. i don't think it ever happened in my lifetime. i have a few more yeast than you do. i don't think it happened that they actually cut anything. do you think that the fact republicans agreed to the tax increases that will get some kind of spending cuts? we keep hearing it is about spending, it is about spending. >> i think the hardest part to understand seems they have no skin in the game. as a business owner and president of a company i have a responsibility to as my clients and my employees and we make decisions that are fruitful and beneficial for the company with the money that we have.
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why doesn't the government have to do that? i feel very strongly that you know, we are held to some limitations. in fact it is against the law, if at times i was to spend more money than i actually have. doesn't make any sense. adam: no, it would make you a politician. >> absolutely. absolutely. there is no skin in the game. yeah, granted i have accountability. i have accountability to clients, employees, to produce the best product and service that we possibly can. adam: sure. >> i don't think that is here. i don't think that is evidence. i think that we've got people coming and going. it will cause for great disruption and going to continue for years and years. adam: steve, let me ask you, when the president spoke mid-afternoon today, did he poke, take his finger and poke it in the eye of the republicans saying i beat you up and now i spit on you? seems like he was doing all he could to destroy whatever deal was on the table? >> i think there were two problems what he said. one was tone. the other was substance. if you look at the tone, this is a president, who at least in theory wanted to
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avert this fiscal cliff. i've been saying all along there are political incentives for the president to take us over the cliff. certainly if you look at the tone of that press statement today, he seemed to be almost mocking the republicans, the very people he needs to get, to go along wiih some kind of a deal in order to avoid going over the fiscal cliff. i'm not sure what his political point there but you substantialively --. adam: i have to go to scott. you get 20 seconds, then i'm giving kim because she is the small business owner last word. scott, any words of advice? they have to do something. they haven't done it yet. >> i go up and stock up on studebakers and yugos. watch out for the stock market here in 2013. a lot of things at play aside from a slowing economy. i think it will be really bum , man. adam: kim, you get the last word. what would you say to congress, not the president but congress, what they should do later tonight and this week? >> first off i would have made a decision a long time ago. we had two years to this problem. this problem should have
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been solved months ago. politicking should have been set aside. we should have got something done. people should not have gone home for thanksgiving. i don't understand if they're representing us as business owners why they can't act like us and make decisions like us. we have to do it every single day. adam: just to set the record, straight, scott, some studebakers hold their value. congress, not much. >> zero. >> but can they avoid the fiscal cliff? senator gop john ba roost sew joins us later. no matter what deal congress strikes the capital-gains tax, it shoots up next year. we'll tell you what investors can do to stay in the game. more mony coming up
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♪ . adam: well, less than seven hours until the new year and nothing rippings in the new year better than the government raising your taxes right? the capital-gains tax increase will be 20% from the current 15%. some argue that would generate more money from
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unsell cam. my -- uncle sam. my next guest has a long list of reasons that this would hurt the economy. he is the from the cato institute and head of downsizing dost government.org. thank you for joining us on this holiday. >> thank you. adam: why won't it raise more money if we raise the capital-gains tax? why won't it raise the money for treasury. >> capital is very mobile. we live in a globalized economy. if the united states raises its taxes on capital, in other words, investment, investment will flee across international borders. countries that have high tax rates on capital shoot themselves in the foot. for that reason, just about every industrial country has a, has cut their capital-gains tax rate. so, for example, our capital-gains tax rate tomorrow, will jump up to 24%. we have state level taxes on top, that brings us to 28%. but the average in the
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industrial world is just 16%. that is because just about every country realizes if you have a high capital-gains tax rate, you shoot yourselves in the foot and you lose investment. adam: who does the rate go up for starting tomorrow? is it everybody? does the state at 400,000? if you make less than 400,000 a year does capital gains rate remain at 15% for you? >> right. the capital gains rate is on highest earners. people in the bottom brackets, the 10, 15% tax brackets will pay the lower rate. so it is just for the highest earners butter this the most important investors in the economy. for example, venture capitalists, and angel investors who have been crucial to silicon valley and our high-tech industry, these are very high earning individuals. they invest in high-tech companies to earn capital feign. so you raise the capital-gains tax. you're going to kill off angel and venture-capital investment in the united states. adam: i think we have a graphic that shows what the capital-gains tax in the united states has been going
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all the way back to 1980. at one point it was 28%. that's when president reagan and his administration cut it. at one point during the clinton administration, down to 20%. 1997 through 2003. let me ask you about that. when it was at 20%, didn't we enjoy a tech boom? didn't seem to drive investment away then. why would it drive investment away now if we go back to 20%. the 24% or 23.8% is on highest, highest, talking warren buffett incomes at that point? >> you know, there is lot going on in the economy at any time other than the capital-gains tax rate. i am saying that if we raise it too high, we do risk killing high-tech investment. so, you know, there is a lot of economists frankly argue that our tax rate on capital gains ought to be zero. in fact there are about a dozen high-income countries like netherlands, new zealand, mexico, have capital-gains tax rates of zero.
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so i think the benchmark here is zero because capital gains is so important. it actually represents double taxation. capital gains income is already taxed at the corporate level. we don't need to tax it again at the individual level. adam: forgive my tax ignorance here but i do have a question that might be important. if i'm a u.s. citizen and say i invest in another country, when i sell that investment do i pay the capital gain to that country or do i pay it in the united states since i'm a citizen of the u.s.? >> pay both but then you get what is called a foreign tax credit for your foreign taxes paid. basically the u.s. treasury taxes you on "your world"wide income. however, it does ccedit you for some of the foreign taxes you've paid. adam: would the credit, would the credit, wouldn't that minimize the impact of the increase here in the united states? or is it the other direction and forces investors to seek invests overseas as opposed to here where they pay the
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higher capital-gains tax rate? >> what is important here we want foreign investors to come to the united states and invest in our growth companies and our high-tech companies. if we have a high capital-gains tax rate it will hit those foreign investors. so we want, investment money flowing into the united states. if we have high tax rates we'll be scaring away that inflow of investment. adam: we certainly saw a lot of people selling off some of their assets at least in equities up until today in order to avoid the higher capital-gains tax. >> oh, that's right. capital gains. thank you very much. adam: we have to wrap it up here. i appreciate you joining us. you have a good new year, sir. i'm sure this will be an issue congress will try and address as we go through 2013. >> i sure hope so, thank you. adam: iran wraps up war games in the strait of hormuz, reportedly test firing missiles near the critical passage of oil supplies. is this a new threat or a misfire? gop senators gathering a short time ago regarding the fiscal cliff. senator john barrasso joins us where things stand at
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this very moment. and whether a deal will get hammered through tonight in the senate. that is coming up. do you ever have too much money?
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♪ . adam: all this talk about the fiscal cliff could make you forget there are other hot spots in the world so we're going to turn our attention to the middle east and some potentially troubling news from iran. officials there report a successful test after surface-to-air missile during military drills taking place near the strait of hormuz. the strait, which the iranians have threatened to close, is a crucial passageway for 20% of the world's oil. what could this mean here in the united states? with me now is michael rubin, resident scholar at the american enterprise institute and a happy new year to you, sir.
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what does it mean for the united states? does it up the ante or is this more bravado from the iranians? >> certainly, adam, we need to take iranian bravado seriously. they are sabre-rattling, when it comes to the military tests there are photoshop warriors to be attached but the iranian arms industry is becoming more lethal and indeed they're getting a lot of help, not only from countries like north korea, but also from countries like belarus and perhaps even russia. adam: do we know for a fact this test really took place and it was successful or are they plain out lying? >> we don't know that yet because in the past sometimes the tests have been exaggerated but remember, the iranians can learn just as much from a failed test as they can from a successful test. but what we do know is this. the iranians have been expanding beyond the strait of hormuz. they have established naval bases on the indian ocean, the sea of oman.
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they have sent ships up through the suez canal. and they have been talking about establishing a base in at sudan in the red sea area, so certainly iranians do seem to be expanding their military reach. adam: but the iranians sometimes, and please correct me when i get this wrong, they're almost like a child who wants attention and starts screaming and yelling louder and louder. they have been screaming and yelling for the last two weeks an doesn't seem like the world is paying too much attention. why would they be sabre rattling now? are they in the midst of wanting to make a deal to avoid what could be a israeli attack or what is worst, implementation of sanctions for their economy? >> iranians are not on the verge of making a deal. when you actually look at their statement they think they hold the stronger hand of cards. what i do think iranians are trying to do, however, is increase the price of oil because even if they sell it at a discount, if the price
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of oil goes up, then they get more money to subsidize their economy and their economy isn't a very structured economy. adam: that's the key. their economy is in a shambles, is it not? is that part of why they're essentially what we would say in the vernacular gone ballistic? they're trying to get the world's attention, ahmadinejad, their administration are they not teetering? i don't know if they have protest in the streets because we're not seeing that coverage but the economy is in a shambles. >> the economy is in a shambles but remember this two things. first the revolutionary guard more or less dominates the economy. they dominate the military and also dominate iran's own oil investments. since ahmadinejad came to power in 2005 they have had 35 to $40 billion worth of contracts go to the revolutionary guard for the oil industry and that compares to an average irgc budget of only $5 billion a year. so you have that going on, on top of which they kind of
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figure that they can push a little bit further because every time they push the west gives them incentives to calm them down. it is a pattern which they openly talk about in their press. now the only time that iranians have actually really backed down was ending the iran-iraq war in 1998. ayatollah khomeni at the time --. adam: i have to wrap-up. >> like drinking a challis of poison. we're not there yet. adam: i have to give you the last word. appreciate you giving insight into the situation in iran. we've been looking at this every day since last week and it does not look good. thank you, sir. have a happy new year. >> thank you. adam: we'll look at today's fuel gauge report. optimism for the oil futures to 2 1/2-month high. it settled at 91.8 it on the last day of trading for this year. u.s. crude prices fell 7.1% for the entire year. 2012 was a record year for opec. the cartel raked in, are you
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sitting down for this? more than a trillion dollars. i feel like dr. evil, a trillion dollars in oil revenue according to the u.s. energy information administration. that tops previous records set during the oil crease sis of 73, '74, 1981, even when you adjust for inflation. the average price of gasoline for the year also set an all-time record here in the states. according to aaa drivers paid $3.60 a gallon beating the previous record set last year. we beat that record unfortunately by nine cents. natural gas futures fell. a slate of cold temperatures recently pushed prices up with higher demand but forecasters say unusually warm temperatures are heading for the midwest and northeast as early as this weekend. the senate gop caucus end ad high stakes meeting just a short time ago. will senate republicans embrace the latest framework for a fiscal cliff deal? also how failure to get a
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fiscal cliff deal could lead to a mortgage rate free fall. "piles of money" coming up. ♪ [ male announcer ] how could a luminous protein in jellyfish, impact life expectancy in the u.s., real estate in hong kong, and the optics industry in germany? at t. rowe price, we understand the connections of a complex, global economy. it's just onreason over 75% of our mutual funds beat their 10-year lipper average. t. rowe price. invest with confidence. request a prospectus or summary prospectus with investment information, risksfees and expenses to read and consider carefully before investing.
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adam: in the mid of all the fiscal cliff frustration there is actually a silver lining.
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if your knew year's resolution to purchase a house you may be in luck. on again, off again deal may be pushing mortgage rates even lower. average fixed year is.35%, that is according to freddie mac. that may not be the bottom. with me team investments president and founder. we appreciate you being here on a holiday evening. let me ask you very quickly. why would the fiscal cliff negotiations push mortgage rates down? i thought that was the federal reserve and all the money they're pumping into this economy? >> well, if they do not come to same kind of a conclusion and get us over this cliff the rates will stay down because people need to borrow. i read a thing today that said it is lower, your payment is lower to purchase a home today for $275,000 with 5% down, than it was in 1987 purchasing a home for $170,000. adam: about are you seeing a
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correlation between the fiscal cliff and the chaos we've been reporting on for several months and the drop in mortgage rates? different than the way the federal reserve drives down interest rates? >> well they're going to keep the mortgage rates low as an incentive for buyer, period. but we'll see them tick up a little bit towards the middle and end of 2013 because they have to be able to let people borrow again. borrowing requirements are so tough right now, there are a lot of people that can't borrow. rates will tick up a little bit and requirements will go down a little bit. adam: are you worried, this chaos in congress over taxes, we still don't know exactly what the tax impact is going to be going forward. we don't know what kind of cuts there are going to be if any going forward. all of this could cause the economy to stall, which would be disaster for the housing market, barely recovering. i know some people say it is recovering well. ihs put out a brief the other day, a note saying, don't pop the champagne corks yet on at least
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housing? >> i do agree with them a little bit. where the fiscal cliff is scary for housing is the 2007 debt forgiveness act. if they do not extend, people will just foreclose. short sales, even banks get in on the short sales programs because they make more money on short sales. people have better end results when they short sale. if that doesn't happen and they don't come to the conclusion people will foreclose, because they won't bear the burden of tax situation as you do when you short sale without the debt forgiveness. adam: quickly, if not buying but selling should i sell now? i always heard you don't sell during the holidays. wait near the spring when people buy a house to get the kids ready. is that a bad thing or should i put the house on the market? >> holidays are a great time to buy. that is the biggest myth. adam: what about sell? >> you have serious buyers out there. if you're selling you have serious people walking through their house. they may need to get their kids into a certain school
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district or may need to change jobs before the beginning of the year. sellers may sell to avert the tax implication. there is lot of reasons to buy and sell during the holidays. just on an emotional buy, people are more emotional during the holidays. so you get what you want pricewise as a seller. adam: tonya, we appreciate you being here on a holiday. we wish you all the best especially in phoenix. we know the housing market there has actually turned around and people are optimistic about that. >> it has. happy new year, adam. adam: thank you. a high-stakes meeting between gop senators is now over. we'll get the latest where things stand. when you look over the fiscal cliff don't look down because it is a far drop because at the end of the day it is all about money
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♪ . adam: all right. lawmakers in the house just finished a meeting about what else, the fiscal cliff. peter barnes is at the white house with the latest. peter, do you know, was this a meeting of the house or was this a meeting of lawmakers from the senate? >> there have been meetings of both going on, adam, on the republican side. most importantly the senate
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republicans have been meeting and the house republicans have been meeting and we have just learned that the house republicans do not plan any vote tonight. they are going to go back into session now tomorrow, new year's day at noon, to await something from the senate. and so far over on the senate there is no vote scheduled tonight for this framework deal between the president and mitch mcconnell. adam: okay i'm going to quote that old tv show, danger, will robinson, danger, will robinson. >> "lost in space". adam: "lost in space which a lot of people think our political class is. simmons uttered a question that 310 million americans want to ask congress. what the --. what are you doing? we're growing off the cliff. they're is a deal, why aren't they voting for it in the senate?
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>> they don't have the deal yet. they're still trying to work out some of the provisions for this. they have a framework kind of an agreement to agree on a framework for a deal that still has a couple of critical components to it unfinished, unends ased. key among those are what to do about the sequestration, the spending cuts, that $100 billion of automatic cuts that begin on january 2nd. half of them going to defense. there are some, plenty of republicans but some democrats, there are members who would like to cancel that all together. have none of these cuts occur next year. there are some who want to try to replace those cuts with something else and spread them out a little bit more so they don't all fall on the defense department too hard in particular. and then there is some ground in between. and so, they're still working out that particular provision. which is a sticky one. a lot of republicans, right now there is, other than
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that, there are no spending cuts in this deal. adam: peter, is it, is it true that the president early this morning, mitch mcconnell i guess wrote a note to his colleagues, and said essentially they had done the tax deal but the president threw a wrench in it at the last minute, this happened two years ago when the president was dealing with john boehner but at the last minute said no ski questions operation. all spending cuts off the table? is that accurate? would the president take blame for pushing us off the cliff? >> well, it was apparently, from the white house, by joe biden, the vice president has been negotiating and the story according to our producers up on the hill there was an agreement to try to deal with the sequestration by having both the democrats and republicans make their own proposals that could be considered and voted on. adam: peter this, is urgent. this is just crossing right now. republican u.s. senator john mccain says automatic spending cuts to be delayed
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for two months under tentative fiscal cliff deal. that would seem to me we're going to get a vote at some point this evening on the tax portion with the delay. we get it in the senate and then it would move to the house and latourette is saying house members have been told to stay close. they may be called back to continue fiscal cliff negotiations. >> yep. you have got the wires right there. and so there had been some conversations, some reports that there might be a two-month or 90-day sequestration, a delay in the sequestration as part of trying to get through this to buy the congress the new congress, more time to do this in a more deliberative way of the as you recall the sequestration was meant to be a hammer from the big super-committee, from back in the 2011 debt ceiling deal. adam: right. >> and everybody thought they would work that out in the super-committee. the super-committee did not work out anymore measured considered cuts.
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now we have the hammer and members still don't want the hammer. they want to have a more deliberative process. this would buy them time to do this. adam: buy them time. peter barnes, as i wrap up and wish you a happy new year, i think a lot of americans promising to cut spending in two months they would prefer to buy a bridge in brooklyn. have a great new year, peter, i have a feeling we'll see you throughout the evening. >> thank you, adam. adam: the los angeles mayors takes aim at reducing guns on the city street. do we have the picture? you will love this. he wasn't expecting to get one of these. it is a rocket launch cher. what do you do with that? kids, eat your vegetables. you can never have too much money.
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♪ adam: it's time for some fun with spare change. today joining us top personal finance expert and our own david asman. a ground rule. nobody is allowed to say fiscal clef. >> oh, good. adam: we are not going there. this is a good one. teddy's officials passed a law that jewish mothers worldwide will love. requires children to care for their elderly parent. and you have to visit them frequently or you face a fine.
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but the law is vague. it is just -- it does not say how often children should visit. they care -- you have to visit mom and dad and take care of them. >> how will they enforce? it is not feasible. >> i do think we should be paying more attention. we should not leave them in isolation. but to enforce something like that. >> the old joke. the parent says, it's okay. >> we're supposed to have fun, but they're is a serious side to this. china has the ninth month abortions. when you destroy life on young side is not too far distance to go to the strait of the old site. i think some of that is happening. adam: do you think anybody will take that seriously? >> we will see what happens. >> is serious side of you. >> there is. very serious. adam: let's talk about kim kardashian. is the talk of the town.
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after eight months, kim is having a baby. the rapper announced it last night at a concert in atlantic city. kim's family has been tweeting their excitement. david, are you aware that the greatest contribution to mankind is a videotape. >> first of all, i didn't even know that she wasn't married. she's married to somebody else. so what married to people with whom there not. >> an artist. >> a fine example. >> right. >> have you seen that movie? i haven't. >> its online. it runs on cinemax after 2:00 a.m. >> another baby, another reality show. >> it is almost like a disease that will go away. enough of them already. >> enough of them. >> although he would lose one of his great tag lines. we have president kardashian.
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the whole celebrity culture. people have zero talent to are in positions of influence just because they are celebrities. >> and yet the news went viral. it's crazy. >> i don't care. >> and we are talking about it. here is one that we didn't get to on friday. breaking news. i was about to say it. we paid good money to be able to show you this. the lapd held a gun buyback and they received to rocket launchers in addition to 1900 and again, shot dead, and rifles. gift cards with up to $200. are you worried about this? >> weapons of war. not target guns, hunting guns. >> where you get a rocket launcher? >> they say they came from family members. >> i'm not quite. when i was a kid there was a kid down the block to have a bazooka that his father brought. >> where did you go to school? >> another kid down the block, his father had been in vietnam.
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these things happen. >> that's a little different. >> they showed up before. >> may be that all of them are unusable, but most of them. too old. >> is in their essonne, if i have a rocket launcher. actually is a song. okay. we may be getting close to the day when you can leave your electronic devices on during takeoff. the faa says the rule makers will review a decision sometime in january. when do you think we will see them do something that allows you to use the kindle the whole flight to back people sneak it on a never turned off. >> anything that doesn't transmit signals should be allowed, but from the airline perspective is too many electronic devices to follow. >> people's conversations on the cellphone. >> of course. to have enough problems with my own conversation. i guess they figure out a way to make the cabin in solar from what goes on in the